Tax Bill from Norwegian Tax Authority

[stek]

In the 2013 treaty (can't find 2012) but i "presume" it wouldn't be remarkably different.
Company never shifted its operations

https://www.gov.uk/government/upload...-_in_force.pdf

Article 4
Resident
1. For the purposes of this Convention, the term “resident of a Contracting State” means
any person who, under the laws of that State, is liable to tax therein by reason of his domicile,
residence, place of management, place of incorporation or any other criterion of a similar
nature, and also includes that State and any political subdivision or local authority thereof.
This term, however, does not include any person who is liable to tax in that State in respect
only of income or capital gains from sources in that State.

3. Where by reason of the provisions of paragraph 1 an individual is a resident of both
Contracting States, then his status shall be determined as follows:
a) he shall be deemed to be a resident only of the State in which he has a
permanent home available to him; if he has a permanent home available to him
in both States, he shall be deemed to be a resident only of the State with which
his personal and economic relations are closer (centre of vital interests);

Article 7
Business Profits
1. Profits of an enterprise of a Contracting State shall be taxable only in that State unless
the enterprise carries on business in the other Contracting State through a permanent
establishment situated therein. If the enterprise carries on business as aforesaid, the profits
that are attributable to the permanent establishment in accordance with the provisions of
paragraph 2 may be taxed in that other State.

As i never moved permanently to Norway they wouldn't be seeking a cut of corporation tax.

That's only the DTA though, check europa.eu for the directives.

[eek]

That's only the DTA though, check europa.eu for the directives.

Your company is as far as Norway's tax office is concerned an irrelevance. You as a person worked in Norway for 30 days, they want their tax paid on that 30 days of work.

[TimTyler]

Your company is as far as Norway's tax office is concerned an irrelevance. You as a person worked in Norway for 30 days, they want their tax paid on that 30 days of work.

It would seem so, hence they do not recognise UK limited companies.

[Sub]

Your company is as far as Norway's tax office is concerned an irrelevance. You as a person worked in Norway for 30 days, they want their tax paid on that 30 days of work.

Well, tax authorities taxing income, not work itself. OPs income (personal one) actually occurred in UK not in Norway, because his salary/dividends were paid in UK (I assume so) from his UK company account to his UK personal account. It is company who earned money in Norway, not him.

It is possible that his company will be liable for some taxes in Norway, because work was performed on Norway territory, but fact that it is income tax is indicating taxman is looking for him personally, which can be resulted by his customer declaration that money were paid to person rather than company.

[eek]

Well, tax authorities taxing income, not work itself. OPs income (personal one) actually occurred in UK not in Norway, because his salary/dividends were paid in UK (I assume so) from his UK company account to his UK personal account. It is company who earned money in Norway, not him.

It is possible that his company will be liable for some taxes in Norway, because work was performed on Norway territory, but fact that it is income tax is indicating taxman is looking for him personally, which can be resulted by his customer declaration that money were paid to person rather than company.

Any tax authorities will ignore artificial devices added to avoid paying tax.

If you as an individual travel somewhere to do some work don't be surprised if the country believes your overseas limited company is irrelevant to their tax collection.

Granted it seems that the Norwegian end client didn't know what they needed to do but as it's clear the op didn't do their own research both parties are clearly at fault

[SueEllen]

In the 2013 treaty (can't find 2012) but i "presume" it wouldn't be remarkably different.
Company hasn't shifted its operations

https://www.gov.uk/government/upload...-_in_force.pdf

Article 4
Resident
1. For the purposes of this Convention, the term “resident of a Contracting State” means
any person who, under the laws of that State, is liable to tax therein by reason of his domicile,
residence, place of management, place of incorporation or any other criterion of a similar
nature, and also includes that State and any political subdivision or local authority thereof.
This term, however, does not include any person who is liable to tax in that State in respect
only of income or capital gains from sources in that State.

3. Where by reason of the provisions of paragraph 1 an individual is a resident of both
Contracting States, then his status shall be determined as follows:
a) he shall be deemed to be a resident only of the State in which he has a
permanent home available to him; if he has a permanent home available to him
in both States, he shall be deemed to be a resident only of the State with which
his personal and economic relations are closer (centre of vital interests);

Article 7
Business Profits
1. Profits of an enterprise of a Contracting State shall be taxable only in that State unless
the enterprise carries on business in the other Contracting State through a permanent
establishment situated therein. If the enterprise carries on business as aforesaid, the profits
that are attributable to the permanent establishment in accordance with the provisions of
paragraph 2 may be taxed in that other State.

As i never moved permanently to Norway they wouldn't be seeking a cut of corporation tax.

Apart from being foolish for not looking this up before you agreed to the contract, are looking at the wrong part of the Norwegian tax regulations. All the Nordic countries always give their tax advice in English online as well as their own languages since loads of foreigners read and speak English. So look what I've found for you - Linky

Limited tax liability

Foreign nationals who are engaged in business activity in Norway are required to pay tax on income from business activity which they are carrying on or participating in and which is being carried on here or managed from here. This includes activity where employees are placed at the disposal of others within Norway. This means that foreign nationals who are engaged in business activity in Norway which is run for their own account and risk, including those who hire out labour, are liable for tax in Norway on the income generated by their activity. This is known as limited tax liability.

Also if you only have one director and it is you, your company has permanently moved to whatever country the work is in regardless of whether the contract is 1 day or 100 days. This is easy for the Norwegian tax authorities to find out and verify as they just need to look at Companies House online.

I suggest you take the advice already given to speak to a Norwegian accountant and then a UK one to sort the mess out.

[stek]

Apart from being foolish for not looking this up before you agreed to the contract, are looking at the wrong part of the Norwegian tax regulations. All the Nordic countries always give their tax advice in English online as well as their own languages since loads of foreigners read and speak English. So look what I've found for you - Linky



Also if you only have one director and it is you, your company has permanently moved to whatever country the work is in regardless of whether the contract is 1 day or 100 days. This is easy for the Norwegian tax authorities to find out and verify as they just need to look at Companies House online.

I suggest you take the advice already given to speak to a Norwegian accountant and then a UK one to sort the mess out.

+1

Think about it, a person, employee, partner, or company can't turn up and trade in a foreign country and not pay any local tax.

Defies logic...

[SlipTheJab]

+1

Think about it, a person, employee, partner, or company can't turn up and trade in a foreign country and not pay any local tax.

Defies logic...

Tell that to Apple, Amazon, Starbucks etc

[BigRed]

Try telling Apple that

[SueEllen]

Tell that to Apple, Amazon, Starbucks etc

I doubt the OP has the deep pockets plus the international tax accountants, international tax lawyers, lawyers and accountants that such multinational companies have.